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Welcome to Roger's Economic Rant

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January Economic Rant -Roger Mason

"The democracy will cease to exist when you take away from those who are willing to work and give to those would would not." -Thomas Jefferson 

Welcome to 2009. This is going to be a horrible year for the lemmings, but a wonderful year for intelligent people who are invested in silver and even gold. Twelve states are broke, twenty are right behind them, and eighteen more will soon join them. California is the eighth largest econ-omy in the world, and hopelessly broke due to rampant socialist, welfare policies. That's right, California has a bigger GDP than over 160 entire countries. Never before in American history has a state gone bankrupt. This is telling you the other 49 will soon go broke, too.The prime rate is now down to 0.25%, but we're printing counterfeit money at 18%. The dollar has collapsed to 80 cents on the USDX and headed for 40 cents (it was $1.20). All currencies are worthless paper including the Swiss franc. True inflation is at least 18% based on M3 figures (the government tries to hide). Go to www.shadowstats.com to see the facts. You have to make 18% on your savings and investments just to break even. The stock market is hopeless; ignore it. It may go up or down in the short term, but will end up at 5,000 on a good day. It doesn't matter what it does in the short term. The  budget deficit has been out of control for years, as has the trade balance. Real unemployment is at least 15%, and not the official 7%. It is headed for 30%. Soon, anyone with a job will be fortunate. Gasoline is down to $1.60, but consumption is down because people can't afford to drive. People can't even afford cheap gas now. Christmas was the worst disaster in 80 years and the media tried to minimize the extent of it. Consumer spending is in the basement yet 70% of our GDP depends on it. Credit cards are maxed out, and people are unable to pay the balance. They can't live off their cards anymore. Now the banks have to pay them. This is just the beginning and the economy can only end in total disaster. Housing will keep collapsing in 2009, 2010, and maybe into 2011. You will buy any house or commercial property you want for a quarter on the dollar based on 2005 peak prices. We have one million unsold homes, and the homebuilders are all bankrupt. The median house price is down to $181,300 and headed much lower. There is a stunning 13% retail store vacancy rate and an even worse 16% office vacancy rate. These stores and offices will stay vacant and more vacancies will be seen every month. The International Council of Shopping Centers said 150,000 stores closed in the U.S. in 2008 and another 150,000 will close in 2009. Actually, it might be worse. Almost one third of a million stores will shut down in just two years. The entire real estate situation is in a hopeless, terminal death spiral. Now you can see the Much Greater Depression around the corner.
 
The sheeple chose an openly Marxist president for the first time in 232 years, and we're going to pay for it worse than you can dream of. Just remember that wealth is never destroyed, but rather transferred. Just as all bills get paid either by the buyer or the seller. This is the biggest wealth transfer in history, and YOU are paying for it. Your children and grandchildren are also paying for it. Your unborn great grandchildren will still be paying for it. All the bailouts will be at YOUR expense. All the money printed will ruin you economically thru inflation, the silent, quiet thief. Think hyperinflation and falling dollar. There are some flagship, mainstream, pillar-of- the-economy stocks that should be monitored. WalMart (WMT) (including Sam's Club) is not doing well. Costco (COST) is down a third. Target (TGT) has collapsed almost half. People aren't paying off their maxed out Target credit cards. Best Buy (BBY) is also down half. McDonalds (MCD) is doing badly. People cannot afford to shop at the biggest and cheapest discounters in the entire world because they're BROKE! Obama Hussein has promised to put an end to the coal industry even though we're the Saudi Arabia of coal in the world and it produces 52% of our electricity. He'll just give us windmills and ethanol, and maybe some fuel cells. Meanwhile we're sitting on 200 years of domestic oil and gas the liberals refuse to drill.
 
Silver has been, is, and will be the best investment on earth. The gold to silver ratio has dropped to 76 to 1 and is probably headed for 10 to 1 (e.g. $3,000 gold and $300 silver). You can still get 1,000 oz COMEX silver bars from major coin dealers at the fake paper spot price, but this will end suddenly any day. J.P. Morgan Chase is the only price manipulator now, and they are down to 25,000 short contracts. This will also end soon. Now the industrial users are fighting for the available silver. Remember, you can't replace silver with anything, and you can't do without it. You would not have a car, phone, computer, TV, or any other electronics without silver. There are only about 50 real silver stocks in the world, and at least 40 of them are not good investments for a variety of reasons. The mining stock prices are down very much and they are wonderful bargains. Quaterra (QTA), Silverstone (SST), Endeavor (EXK), U.S. Silver (USA), Impact (IPT),  Genco (GGC), and ECU Silver (ECU) show the most promise. These are all solid producers. The HUI Index is 300 now (high 480 and low 150) and will soon pass 500 as people figure out silver and gold only come from mines. Do not buy paper silver like ETFs, and do not let anyone store your silver for you. You must hold this personally. The big news is that half the available gold and silver on the COMEX were bought and possessed. This is of tremendous importance. The COMEX is the largest repository of both in the world. The available stocks (12/22) are down to a mere 49 million ounces. (The rest are owned and stored.) We predicted silver would reach $25 by Christ-mas instead of $10. This was only wrong on timing. Silver will soon hit $25 since the COMEX is almost empty.
 
 
We all know the airline industry is a pillar of our economy. In the last ten years the airlines have collapsed 95% in value as proven by the XAL Airline Index. In 1998 this was at 200, but has fallen to 10- a lost of 95%. Just In the last five years from 2003 is has fallen from 80 to 10-  a loss of 88%. It's not coming back. People can't afford to fly anymore. They're too busy trying to pay the rent, the utilities, and put food on the table. The airlines were (as in used to be) a very basic industry, and America was the only country in the world the common person could fly regularly nationally, or even internationally.
 
Marxist Obama Hussein lied to everyone and anyone to get elected. Speaking of liars, Bush said he abandoned free market principles in order to save the free markets. That makes sense. Obama is not going to take the troops out of Iraq. Quite the opposite, he is going to increase the Afghan troops from 20,000 to 58,000. He wants to invade Pakistan for God's sake! Why in the world should we attack Pakistan? America has every intention of joining Israel to attack Iran. If we bother Syria we're going to have Russia down our throats. Now Israel has murdered hundreds of Palestinian men, women, and children and injured thousands instead of going after Hamas. India and Pakistan are almost at war. None of this is our business folks. This country was founded on a principle of laisse faire or don't interfere in anyone else's business. How did we become the World Policeman, and now have replaced Russia as the World Bully?
 
General Electric (GE) is the biggest corporation in the world. Their stock has gone from 41 to 16 in only 18 months. That's a loss of SIXTY PER CENT in a year and a half. The world's largest corporation has lost sixty per cent of their value. Puritan's Pride is the biggest vitamin and supplement discounter in the world (NTY). Their stock has fallen 54 to 13 in only 18 months- a loss of three fourths of their entire worth. (We're doing just fine here at Young Again thank you.) Senile in Omaha Buffet is going broke by the day while telling you to load up on stocks. Go look at his pitiful Berkshire Hathaway (BRK-A) stock. A paid shill, a government whore is all he is. Buffett's father was a strong gold and free market advocate as well as a patriot. What happened to Warren? Why would a billionaire prostitute himself for the government?
 
In 1918, only about 90 years ago, Britain was the richest and most powerful nation in the world. The Pound Sterling was the world reserve currency. That's right, Britain was richer and more powerful than America. Then they started to collapse and the Pound lost 90% of it's value, Britain became a backwater, and the standard of living was cut in half. The U.S. dollar is no longer the world reserve currency. It was $1.20 on the USDX, and it now only 80 cents. If it loses 90% of it's value it will literally go to 12 cents, and not just 40 cents. The dollar is hopeless, and backed by hot air and lies. There is no gold in Ft. Knox and hasn't been for half a century. There hasn't been an audit done (as required by federal law) in five decades because there is no gold left.
 
Go to www.goldstockbull.com and read Jason Hamlins "10 Predictions for 2009". He is right on the money. He has the whole scenario clearly nailed down on one page. Markets falling, high unemployment, real estate crashing, hyperinflation, dollar falling, oil rising, expensive food, gold rising, and civil unrest/crime. He just needs to realize silver is a much better investment than gold and will rise a lot faster and further.
 
Look at the DOW to gold ratio. This reached the extreme high of 44 to 1 in 2001, but has Fallen to about 10 to 1 now. If you had sold all your stocks in 2000 and bought gold (or silver) you would be rich instead of broke. That simple. In 1981 it was ONE TO ONE and should return to that ratio. For example that could be 5,000 DOW and $5,000 gold. Silver will do even better. 
 
Always remember silver is going to vastly outperform gold for a lot of reasons. The DOW to silver ratio was 17 to 1 ($850 and $50) in 1981. That would be $300 silver with a 5,000 DOW.  You really don't have a choice if you want to survive economically. There is nothing on this earth to buy except silver and gold, and silver is a much better choice. You can't invest in any currency, any stock market, any government paper, any commercial or residential real estate, oil can and will do anything, you can't store uranium, there is just nothing to put your fake paper Monopoly fiat money into. Nothing but silver and gold. They have proven their value for 5,000 years now and never failed. Every country, every society, every culture has fallen by the wayside, but silver and gold have always been a secure store of value, a safe haven  even in war. We are almost out of physical silver. 80% of silver comes from by-product mines such as zinc, copper, and lead, and they aren't doing well. In a few years silver (and gold) will be at some irrational price and we're all going to dump it when that happens. At that point there will be something cheap to buy- such as houses or stocks.
 
 
 
 
Look at the bank stock index above. The banks are broke. They started a huge bubble in 2003 And this bubble is now collapsing. How can we operate when the banks are bankrupt? We can't. The bail out money being given to these banks just makes the situation worse.  

Speaking of bubbles the first bubble was the stock bubble. We all know how this ended. The Second bubble was the housing fantasy. The housing crash has at least two years to go.
 
The third bubble will be gold and silver. The sheeple are always the last to figure anything Out. They will finally wake up and realize silver and gold are the only real money and silver And gold mines are the only place to find them. They will big these up to the usual irrational And unreasonable levels. The hard part is not getting rich from silver bullion and silver mines.
 
The hard part will be to know when to get out before the crash. The triad of bigger taxes, the Bankrupt Social Insecurity scam, and the Federal Reserve (which is not federal and has no reserves) will completely destroy the economy. Just keep thinking hyperinflation and falling Dollar. That alone will put you well ahead of the crowd. In 1935 trillions of dollars had disappeared due to inflation, but it will be much worse this time. The coming depression will Make the Great Depression look like Club Med. Did you know that Bush has 40,000 military troops trained now for crowd control and civil unrest? The American War College reported this. Did you know that long ago FEMA built a huge and extensive system of detention camps or mass scale prisons? Millions of people are going to be locked up with no trial, no civil rights, no nothing. It will be very easy to go to Jail for saying and writing the wrong things. Don't be one of them. Speaking of the military, we have over 750 military bases all over the world and we don't need one of them. It is not our business to police the world; it costs too much and just causes more trouble than it cures.
 
2009 is going to be the worst year ever and 2010 even worse. Prepare yourself. Profit from disaster and collapse. Party while your brain dead friends stand in soup lines.

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